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Who is Regulated in a Securities Issuance

10. Who are the parties regulated in an offer to sell securities?

The ’33 Act regulates offers to sell securities by a number of individuals, including the issuer, underwriter, controlling party, or sales representative. The “issuer” is the individual or business organization offering a security for sale to the public. “Underwriters” are individuals participating in the original distribution of securities by selling such securities for the issue or by guaranteeing their sale. A “controlling party” is one who controls or is controlled by the issuer, such as a major stockholder of a corporation. A “sales representative” is anyone who contracts with a purchaser or who is a motivating influence that causes the purchase transaction to occur.

•    Discussion: Why do you think that the securities laws regulate the conduct of such a wide variety of sellers or securities? How does regulating the conduct of these individuals align with the objectives of the securities laws?

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